"If we fail to make the payment, yes. But I think it is early now to think about what we will [do] and what they will [do]. This will be speculation for our and their part. We are preparing for all the possibilities," Yaresko told Ukraine’s Channel 5.

The finance minister said Kiev cannot make the payment. "No, we cannot carry out the payment. Under the International Monetary Fund’s program, we have the clearly defined parameters on what we can earmark for what: from budgetary deficit to debt payment," she said.

Yaresko stressed that she was ready to meet with her Russian counterpart to discuss the issue of restructuring the debt. "I’m again ready to meet with the Russian finance minister, I was told that they wanted to invite us for another such a meeting after the G20 meeting in Antalya and I'm ready for such an open dialogue," the minister said.

The minister said the IMF is not ready to help Kiev in paying off the debt to Russia and expressed hope that this debt will not affect the cooperation program with the organization.

Ukrainian Prime Minister Arseniy Yatsenyuk said in mid-October that Ukraine was ready to start litigation with Russia over Kiev’s $3 billion debt restructuring. According to Yatsenyuk, Kiev has proposed that Moscow should consider once again Ukraine’s terms of its debt restructuring and write-down earlier offered to the special creditors’ committee. In case of refusal, Kiev intends to start legal proceedings, he said.

The Ukrainian financial authorities have said on many occasions they consider Russia’s $3 billion loan as a commercial debt and insist on its restructuring. Meanwhile, Russia insists the loan is a state debt and demands its full redemption.

Russia made a decision in late 2013 to invest up to $15 billion in Ukraine’s sovereign Eurobonds. Soon afterwards, Russia bought Ukraine’s first Eurobond tranche worth $3 billion with a two-year maturity and a coupon rate of 5% per annum and coupon payments every six months.

Russia subsequently decided against investing the other $12 billion in Ukraine’s bonds.